Wholesale price inflation in the United States surged 6.2 percent in April compared to the same month in 2020, the highest on record, the Labor Department said Thursday.
The data follow Wednesday's report showing a 4.2 percent spike in consumer prices over the past year, and adds pressure on President Joe Biden's efforts to help the world's largest economy bounce back from the Covid-19 pandemic without causing prices to increase.
Analysts say the inflation seen in recent data reflects the rebound from price collapses seen in the early weeks of the pandemic, as well as the economy's uneven reopening.
The annual increase in the Producer Price Index (PPI) is the highest since the current form of the index was launched in November 2010, and compares to a 1.5 percent drop reported in April 2020.
Excluding volatile food and energy products, PPI rose 4.2 percent over the latest 12 months, also the largest on record dating back to August 2014. A year ago, it dipped 0.1 percent.
Mahir Rasheed of Oxford Economics noted that supply chain bottlenecks are contributing to rising inflation, but the effect should not last.
"We expect upward price pressures to persist in the near term before supply constraints are resolved and base effects fade," Rasheed said, agreeing with the Federal Reserve's view that "much of the acceleration in inflation will be transitory... (and) this isn't the start of an upward inflationary spiral."
PPI rose 0.6 percent compared to March, double the consensus forecast, the report said, noting that a third of the increase was from services. A year earlier, the monthly index plunged 1.1 percent.
And while energy prices have been moving higher, the report said wholesale gasoline prices actually fell 3.4 percent in the month.